ANALYSIS OF JANUARY 2, 2020 SUPREME COURT ORDER

(Posted January 2, 2020) Already? The year isn’t even 48 hours old and we’ve got a decision from The Robes. This is an unpublished order, something I don’t usually analyze; but in my view, this decision is important and ground-breaking, and should be published. The least I can do is spread the word through this website.

Flint Hill School v. McIntosh is a declaratory-judgment action brought by the mother of a student at the school in Fairfax. When the girl’s parents enrolled her in the school, they received a contract and were told to sign. Sign they did, even though the document contained what, upon sober reflection, might be an unwise term from their perspective: “We (I) agree to pay all attorneys’ fees and costs incurred by Flint Hill School in any action arising out of or relating to this Enrollment Contract.”

In case the problem isn’t clear, this broad language doesn’t say that the costs must be reasonable; in any future litigation, the school could hire a team of Philadelphia lawyers, each billing four figures an hour. More important, the parents have to pay no matter who sues, and regardless of the outcome.

This is probably best described as the Litigation Disincentive Clause – it’s plainly designed to thwart any effort to sue the school for any reason, however meritorious. The parents developed a reason: They believed that they had a claim against the school based on unlawful conduct by a school employee. But faced with that awful clause, they feared ruinous consequences even in a winning lawsuit.

The solution they settled upon was for the mother to file a DJ action, seeking a declaration that the clause was unenforceable. The school responded in three ways: This isn’t a case for declaratory relief; the suit sought an advisory opinion; and the mother couldn’t sue without the father’s joining. The school wisely waived the right to seek attorneys’ fees and costs for the DJ action. The circuit court sided with the mother, denying all of the school’s defenses and ruling that the provision was unconscionable and against public policy.

In today’s order, the justices unanimously agree, and affirm. They first rule that this controversy is perfectly suited to declaratory action, because the mother wanted to know before filing suit what her rights were as they relate to fees liability. The court cites prior DJ holdings interpreting insurance contracts, and finds that this case is much like those. It also rules that the circuit court’s decision was an actual adjudication of the parties’ rights, and not advisory at all.

Second, the Supreme Court holds that the absence of the father doesn’t defeat the case. Each parent had the right to sue the school for the alleged conduct, and nothing about the parents’ status as joint obligors mandated that they sue together or not at all. Besides, if the father were a necessary party, the correct approach is to add him, not to dismiss the action.

Finally, the justices rule that the provision is indeed unconscionable. Today’s order cites a previous decision defining an unconscionable term as “one that no man in his senses and not under a delusion would make, on the one hand, and as no fair man would accept, on the other.” It notes that contracts of adhesion – the take-it-or-leave-it scourge of consumers – draw particular scrutiny in unconscionability analysis, and this was that kind of deal.

Ultimately, the justices agree that no sensible party would agree to become liable for unlimited fees and costs even if she wins the litigation. Because this suffices to affirm, the court doesn’t take up the circuit court’s separate finding about public policy.

The single factor that stands out most to me is this decision’s unpublished status. This case cries out for a published opinion; the issues are sufficiently novel that the court should provide published guidance to bench and bar in future suits.

So why does the court choose to mark a given decision as unpublished? I can’t say for sure, because I am not and have never been a court insider. I sense that some decisions are unpublished because the circumstances are so quirky that they aren’t likely to reoccur, so publication wouldn’t have much value as precedent. Indeed, one sentence of today’s order hints at a factor like that: “This case is highly unusual because a specific and anomalous clause of the contract, if applied as written, would have the practical effect of foreclosing litigation on the contract itself.” But the way the court analyzes the unconscionability issue deserves wide distribution, in my opinion.

I’ve long suspected that in the past, previous editions of the court relegated some decisions to unpubs because they wanted them to be invisible for some reason. Before January 2014, those orders were truly unpublished; they didn’t appear online or anywhere but in the court’s order book. But for the last six years, the court has posted them on a separate page on its website. They aren’t digested the way published opinions are, and searching them on the court’s site is laborious. But legal-research resources such as Lexis now report them, and for the pre-2014 unpubs, you could get reports on this website.

If one of the litigants files a motion to publish this one, I earnestly hope the court grants that motion. This decision deserves a spot in Virginia Reports, to benefit all of us.